May 1, 2010

Deep Value Golf Stock

Adams Golf ADGF this little golf club manufacturer that I've talked about a lot in the past has been bottoming out over the past several months and just recently reported their quarter. Revenue was slightly down but EPS was up huge from $.05 to $.21 year over year. They gained some market share in the US.

Net current asset value is $29 million. The market cap is currently right below at the moment at $27 million. So it is in net current asset value territory still at the moment. I bought some the other day at $4.15.

Just recently broke out of a long trading range and had strong unusual volume.

full disclosure:long ADGF

April 26, 2010

Who's Been Buying This Runaway Stock Market?

The stock market keeps rallying but who is buying? Charles Biderman says the pension funds and flows into mutual funds aren't responsible. He says the amount of capital that could drive this type of rally seems to be coming from somewhere else and a lot of it is after market hours in the futures markets. I have no idea if his numbers are even accurate but I found this interview on Bloomberg he did a couple months back interesting.

Click here for Video

April 14, 2010

Baby Boomer Resort Stock

Silver Leaf Resorts is in the business of getaway and destination timeshare resorts in the United States. They cater to short vacations and tourists. This is one of those stocks that bottomed in December 2009 and not in March 2010. I really wish I had payed it more attention early this year. It's one of those deep value land plays.

Asset Valuation
I was fairly surprised at how cheap it appears on an asset level. There is $176.319 million in net tangible assets and as of March 8, 2010 38,140,043 shares outstanding. This gives us a $51.87 million market cap against that $176.31 million in net tangible assets or a 29% discount to NTAV.

I crunched net tangible asset value per share at $4.62 per share and the stock is only at $1.36 as of the close today.

It has technically just broken out of a trading range but has a lot of resistance around the 1.50 area. I think this cheap stock goes higher over the next few days and tests that 1.50 at the least and probably will continue higher from there.

full disclosure:no position at time of writing however I may go long (buy) the stock this week.

March 13, 2010

Silver Mining Penny Stocks List

Silver Stocks list

Timberline Resources (TLR) is into mining for gold, silver, zinc, and copper deposits. They've had some impressive revenue growth over the past 3 years. However no net income yet annually. Last quarter was net income positive though year over year with a profit of $241,061. Technically, right now it is still along the trend line and at the end of a triangle consolidation.

Kimber Resources (KBX) announced a new mineral resource estimate that has significant tonnage of high grade gold-silver mineral resources with excellent metallurgical recoveries. This stock ran from .60s to 1.31 currently and still might have some momentum. It has resistance however that must be dealt with in the 1.50 area.

Mines Management Inc. (MGN) is primarily a silver mining company. The technicals look a little better now that it is trying to break out of this trading range.

Endeavour Silver (EXK) so far has seen its stock price pretty correlated to the price of silver. Out of all the silver mining penny stocks it appears pretty correlated here.

Silver Stocks to Watch
The iShares Silver Trust (SLV) is a very liquid vehicle and a conservative way for making an investment in silver online in the stock market.

The silver vs gold chart shows that gold is up just over 30% this year but silver is up over 60%. Gold has gone practically parabolic currently. Is silver overbought currently? Tough to say but technically it doesn't appear so. I think these are some silver penny stocks to watch for potential upside. In the event of a hypothetical crisis I believe silver historically has outperformed gold by a wide margin.

full disclosure:no positions

March 3, 2010

Deep Value NCAV Penny Stocks

I found a few interesting stocks below net current asset value the other day. A couple of these I know from the past as being volatile. In other words they just didn't trade super thin for months and years, rather, they have been scooped up by institutions before.

Qiao Xing Mobile Communication Co.(QXM) does handsets in China and is really beaten down here. I found it off a screen and when trying to double check to make sure it is sub NCAV if that's a major criteria for you. I didn't see a recent filing on the SEC website and don't want to put a whole lot of time into DD so do your own DD in this regard.

Infosonics Corp. is an old favorite because I made 20% on it last year over a few days and got out near the top. They distribute wireless handsets in Central and South America and distributes high-end products under the Verykool brand name. Off the balance sheet there is $25 mil in NCAV and a $16 mil market cap.

I just got filled finally today on this one at $1.13 and am long.

Seanergy Maritime Holdings SHIP

This is a dry bulk shipper and is beaten down but the technicals indicate it might be bottoming short term.

EF Johnson Technologies EFJI

I really nailed this one awhile back and called the top later on it too.

Unfortunately I don't think I bought it. But, anyway it is back below NCAV of $38 million. It might be bottoming out here. If I play it I might pick it up at mid $.90s so I have a clear stop loss on the breakdown signal.

clean technical bottom so far

full disclosure: long IFON for a trade

February 25, 2010

What Can't Be Hidden

A Seriously Struggling & Flawed U.S. Economic Model
There are a lot of negative things going on economically in the U.S. One of them being the fact that one in four homeowners are underwater and home values and retirement account values are two of the most important determining factors of consumers purchasing behavior. We are in an economy where over 70% of GDP is consumer spending. The retirement accounts are up for now but valuations are about fairly priced at best on US stocks because right now they are discounting an economic recover probably more along the lines of 2001 than 1931 after our Great Depression or 1990s Japan. These people think the 2000s weren't a continuation of the bubble!!? Hello! Greenspan and the housing bubble. The 1990s and 2000s can be corrected by a 2 year recession we have just had?!! I might even argue that the bubble actually started in the 1980s and even earlier with the consumer leveraging up on credit cards and a long standing government induced housing price bubble. The housing based economy is set up on a phony premise of everlasting cheap gasoline and fuel prices, endless supply of credit and perpetually rising home prices.

International Turmoil
There is a real threat of sovereign debt defaults like what we saw with Iceland just recently. Greece, Spain, Dubai and Japan are at risk of default and possibly eventually other major countries. The stock market hasn't realized or priced in additional defaults. That could start a domino effect. I was reading about the Asian currency crisis in the late 1990s. It all began in the small country of Thailand (then seemingly insignificant) and spread to South Korea, Japan, Brazil and Russia. Are Iceland and Dubai like a Thailand was then?

The strange thing so far I'm reading is there was lack of banking supervision prior because they were actually exploited by government giving public loans disguised as private and major asset bubbles were busting around this same time as well. A lot of these Asian countries had less than 30% of GDP comprised of exports which in my view gives some clout to the Austrian economists on what is possible in none Latin American economies and even ones as big as the U.S. There have been a lot of currency crisis in Latin America because of the cyclical nature of their economies among other reasons. In my view what happened in Asia in the 90s and in Iceland just recently shows that currency crisis are possible in a large country like the United States. It's hard to envision a scenario for the US for rates on our bonds not to go up and assuming the economy must continually be jump started and defense spending stays the same there could be serious trouble for the dollar and a following of the rest of the Western nations.

What good is deficit spending and artificial GDP growth like in China where there are empty cities if you still have to pay the piper for decades of juiced excess like here in the U.S.?

When it comes to the possibility of a continuing rise in stock valuations and a lasting improvement "absent stimulus" in the U.S. economy and even China's the burden of proof is on you bulls.

Some Links to Think About
"While deficit hawks have long warned that policymakers need to curb deficits and debt, the new wrinkle is that the U.S. budget deficit picture has worsened so much largely because tax revenues have fallen off so sharply that the government is likely to reach a crisis point much sooner than under past forecasts."


"The 2009 Social Security and Medicare Trustees Reports show the combined unfunded liability of these two programs has reached nearly $107 trillion in today's dollars! That is about seven times the size of the U.S. economy and 10 times the size of the outstanding national debt."


What Happened To The Green Shoots?

Image and video hosting by TinyPic

Delusions of Grandeur

Is it actually possible that the green shoots were merely the result of short-term stimulus and inventory shifts by companies? Is it possible that the trajectory of GDP could go sideways or fall for years or even a decade or two after a serious unprecedented structural shift in the economy?

Bernanke said today many times that the current budget deficit is unsustainable. He also said that deficits of over 3% of GDP are unsustainable over time. These two facts would be troubling but lawmakers and the FED believe they are temporary because solid economic growth will shortly return.

All scenarios revolve around the premise of a solid recovery returning. It has to because we are facing a falling tax base and baby boomers retiring. I'm afraid a stagnant economy like Japan in the 1990s will not even be considered by lawmakers when it comes to spending programs and balancing the budget. But I guess why would it? The U.S. has produced one of the greatest economic track records ever in history. Even more rare and impressive about it is the history of economics on the whole when it comes to other countries is often a very dismal one.

Whether or not things get under control shorting treasury bonds and the dollar should be a good long-term macro play. Of course it is difficult here with the potential for at any time a panic rush to dollars but if there continues to be a flock that creates a mini bubble shorting the dollar seems like a no brainer because at the least it will fall from debasing.

Some articles and videos I have come across recently

Deathbed of Keynesian Economics Will Be in U.K.

Jim Rogers: The Dollar is Doomed

February 19, 2010

Net Tangible Asset Value Stock Plays,Oil & Retail

I crunched oil and natural gas stock Delta Petroleum's DPTR net tangible asset value to be around $515,000 vs a $368,000 market cap.

I'm pretty bullish on commodities and oil with Bernanke being re-confirmed. He's going to drop dollar bills from helicopters or even outer space if he has to to get the economy going(or just to hold its ground). Commodities have done very well the past 10 years because of inflation whether one wants to believe CPI or not. Gold has outperformed the major US indices since 2000.

Retail stock Borders BGP is just over net tangible asset value but has been beaten down a lot lately. I'd especially like to see some commitment by institutions with upgrades because it very well could continue to drop.

full disclosure: no position in BGP or DPTR at time of writing

January 12, 2010

Former Net-Net Stock MSON Soaring

I just noticed former ncav MSON in a technical scan that I initially noticed at the beginning of 2009 is in play on new distribution news. Right now it is a little over net current asset value and I don't know their story here other than there was huge volume recently on this news. As the stock showed in April it can run straight up a ton fast.

I think it might consolidate right around $3.00 around this black resistance at 3.00. This news might give it the potential for a richer valuation of course and more follow through. It's pretty thin and usually doesn't trade that many shares a day.

click for larger image

full disclosure:no position

January 11, 2010

Investimonials.com Financial Reviews

My site is up for review on Investimonials now. Investimonials is a new site for honest user reviews on anything financial from books, brokers to blogs. There's not a lot of transparency in the finance niche and I think this site might have some promise for providing it to newbies.

If you want to take a minute review my blog here

I haven't been posting in this blog as much lately because I am posting my trading stuff on DynamiteStocks.com now. I'm still going to blog about fundamentals and macro stuff on Stock Pursuit like I have been recently. It just won't be every week and that often but rather when I feel like blogging on something like I did on the Buffett Burlington purchase. Google webmaster was showing that post got linked to from the Huffington Post and a Buffett focused blog.

Also, if the market has a serious correction(probably won't happen to soon) I'll throw up some of my net-net ideas here.

Upcoming Post
I'm thinking about a macro play on commodities. More specifically, a play on exporting commodities from the United States. I'm going to do a blog post here on that shortly and will lay out my thesis and brainstorm some of the ways to play it.